NISM Certifications · NISM-Series-VII: Securities Operations and Risk Management · Introduction to the Securities Market
An Indian company wants to list its equity shares on the main board of a stock exchange by offering shares to the public for the first time. Which route describes this activity?
The activity is an Initial Public Offer. An IPO is the first sale of an unlisted company's shares to the public, leading to listing. Rights issues target existing shareholders, buybacks repurchase shares, and open offers arise from takeover regulations.
- ABuyback of shares
- BInitial Public OfferCorrect
- CRights issue
- DOpen offer
Explanation
The first-time offer of shares by an unlisted company to the public is an Initial Public Offer (IPO). A rights issue is offered to existing shareholders, a buyback is repurchase by the company, and an open offer arises under takeover rules.
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